Sunday, March 5

Social assistance payments

The quarterly GDP tables from the ABS include a wealth of data. For example, table 23 provides a quarterly read on social assistance benefits payments in current prices. For the most part, these are the payments made by the Commonwealth Government for things like the aged pension, disability support pension, unemployment benefits (such as newstart allowance), family payments (such as family tax benefit), child care fee assistance, and the like.

We can look at the data in this table with a four quarter rolling sum to minimise seasonal effects.


There are a few of things of note here.

In the first chart we can see that the growth in unemployment benefit expenditure appears to be slowing. 

Looking at the last two charts, state and local government expenditure on personal benefit payments is proportionally quite small. It has also been in trend decline sine 2010.

In the second and last chart, we can see growth in social welfare spending in aggregate has been arrested from mid 2014. We can also see the 2008-09 cash splashes in response to the Global Financial Crisis.

In addition to considering this data in nominal terms or current prices, we can look at it as a percentage of nominal GDP. This gives us a sense of growth in payments compared with growth in the economy.

In these charts other things become clear.

In the first of these charts, our current spending on unemployment benefits, as a proportion of nGDP, is as high as it was in the 1980s recession, and almost as high as it was in the 1990s recession. Nonetheless, expenditure on unemployment benefits, as a proportion of nGDP, has been in decline since mid 2014.

In the second of these charts, we can see that Commonwealth expenditure on personal benefits as a percentage of nGDP has hovered around 8 per cent since the early 1990s.

The post 2010 decline in state and local government payments is more evident as a proportion of nGDP in the third of these charts. Notably, the state and local government role since the early 1980s has been much reduced compared with the 1960 to 1980 period (and especially so when compared with the 1970 to 1980 period).

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